Houston port, airports wait to reopen after Ike

[September 15, 2008]  WASHINGTON (AP) -- High winds, flooding and power outages left behind by Hurricane Ike will delay the return to work for many businesses in and around Houston, the country's fourth-largest city and center of the nation's energy industry.

Airlines canceled flights to Houston on Sunday and planned only limited service Monday. Port officials weren't sure whether they could reopen for shipping as planned on Monday morning.

Some of the city's big corporations announced that they wouldn't open their offices until at least Tuesday, after Ike's winds blew out windows in downtown skyscrapers and flooding closed major roads. Many employees were calling insurance adjusters after their homes were flooded.

In the Gulf of Mexico, some offshore oil and gas platforms were destroyed, federal officials said Sunday. Still, there was relief that refineries, chemical plants and the country's second-busiest port sustained relatively minor damage.

Before the storm made landfall Saturday morning, damage forecasts ranged from $8 billion to $25 billion, but then the storm's path spun away from the heart of Houston's ship channel and refining and chemical plants.

Howard Mills, insurance adviser to the consulting firm Deloitte LLP, said the early forecasts were "a little bit high."

"Houston is a mess, but not as bad as it could have been if the surge had gone up that ship channel," Mills said. "But you're still looking at very significant business-interruption losses. The power outages in downtown Houston alone are a problem."

Beyond Texas, Ike's most obvious impact was being felt at the gas pump. Federal officials had bad news for motorists when they announced Sunday that the storm destroyed at least 10 oil and gas platforms and damaged pipelines in the Gulf of Mexico.

It wasn't immediately known how much effect the damage would have, although it affected only a fraction of the 3,800 production platforms in the Gulf. Three years ago, back-to-back hurricanes knocked out more than 100 platforms.

With more than a dozen Gulf Coast refineries shut down, prices surged above $5 a gallon in some places and the nationwide price for regular rose more than 6 cents to $3.795.

Power outages were slowing efforts to restart the refineries. Valero Energy Corp. said only one of its closed refineries had power, and spokesman Bill Day said he couldn't estimated how long it would take to resume production.

If refineries are unable to restart swiftly, that could also push up fuel prices for airlines, railroads and trucking companies.

Oil companies tried to head off charges of price-gouging, saying that they too were forced to buy fuel on higher-priced spot markets because of lost production at their own facilities.

Chemical company BASF said its six local plants avoided major damage and the largest had power.

Officials at the port of Houston, an economic engine for the region, said they would decide Sunday night whether to reopen on Monday. It all depends on the restoration of power -- which was still out Sunday morning -- and a green light from the Coast Guard, which was still checking the Houston ship channel for any submerged objects that might have been swept into the shipping lanes.

In downtown Houston, about 60 miles inland from the Gulf, streets were littered with glass from broken windows, and officials told people to stay home.

Some of the big corporations based downtown planned to keep offices closed Monday. Natural gas distributor El Paso Corp. said its office tower, where most of the company's 2,000 Houston employees work, had sustained water damage and wouldn't be open until at least Tuesday.

Tenants in the 75-story JPMorgan Chase Tower, the tallest building in Texas, could only assess damage from afar -- they weren't able to get in -- but many of the windows were blown out.

"Broken windows are very expensive," said Tom Larsen, senior vice president of EQECAT Inc., which provides storm-damage forecasts for insurance companies. "Water gets in, so you wipe out all the walls, all the ceilings, all the computers."

Law firm Andrews Kurth LLP, headquartered in the JPMorgan tower, planned to farm out its 250 lawyers based there to other locations in Texas but continue doing its work -- "All of our BlackBerrys are working," said spokeswoman Ashley Ronald.

Another law firm in the tower, Locke Lord Bissell & Liddell LLP, didn't expect to reopen until at least Wednesday.

More than 3 million people in Texas lost power during the storm, and although utilities scrambled to restore service, some areas of Houston could be without electricity for weeks, officials said.

Larsen, the EQECAT executive, said after big storms most businesses are back running within a week. His firm was sticking with its pre-landfall forecast of $8 billion to $18 billion in damage.

"Financially, this was a big storm," he said.

Residents and business owners deluged insurance companies with calls.

Nationwide Financial Services Inc., one of the smaller insurers in Texas, had received more than 5,000 claims by midday Sunday. Associate vice president Tracy Thaxton said the company's call centers expected 8,000 calls Sunday -- 2,500 would be normal -- and even more in the days ahead as people return to storm-hit areas.

[Associated Press; By DAVID KOENIG and STEPHEN MANNING]

AP Business Writer David Koenig reported from Dallas and Business Writer Stephen Manning reported from Washington, and Business Writer John Porretto in Houston contributed to this report.

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